Apollo Tyres (Lord of the Game)

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From being the first and largest Indian multina-

tional tyre corporation, Apollo Tyres has traversed

a long journey since its inception 34 years ago.

The seeds of growth germinated with the open-

ing of its f irst plant at Perambra, Kerala. In 1991, it set up

another Greenfield plant in Gujarat, today the biggest plant

in southeast Asia. Thereafter in 1995, it acquired another

plant in Kerala, called Premier Tyres. Mr. Onkar S Kan-

war ( presently the CMD ) took lead of Apollo in between

1979-80, a time when a major turnaround was required. In1995, he was joined by his talented younger son, Mr. Neeraj

Kanwar, who is sharing the responsibility of carrying the

family legacy forward as Vice Chairman & MD.

Though the company had been on a growth path, it

was not until 2005 that the need to focus on HR systems

was realised. Mr. Tapan Mitra (Chief – Human Resources )

recalls, “HR mostly comprised home-grown people from

other disciplines. So, there was a dire need for profes-

sionalism.” This was when Mr. Mitra joined the company.

With a huge challenge to build HR from scratch, he says

Passion

inMotion

Apollo Tyres lTd.

TApAn MiTrA,

Chief-hr, apollo tyres ltd.

PHOTO: sujan singH

LOrds Of THe game

30 The human facTor January 2011



• FirstIndiancompanytoreachtherevenueofUSD1billion.

• FirstIndianmultinationalwithinthetyreindustry.

• FirstintheworldamongtyrecompaniestoachieveBS7799certication.

• LargestsupplierstoOEMsinIndia.

• Apollo’sGreeneldplantinGujaratisthebiggestplantinsoutheastAsia.

Jewels in the King’s Crown

that they roped in Mercer as their HR

consulting agency and worked towards

professionalising the function.

At this time, Mr. Arun Maira (the

then Chairman of the Boston Consult-

ing Group ) was also rolled in as con-

sultant for leadership intervention to

chart the company’s future. Adds Mr.Mitra, “He took our top team of about

15 to 16 people to Shimla where for

three days, we deliberated on our next

big step. We planned the mechanisms

to achieve our goal to become a USD

two billion company in five years’

time.” This intervention set a start to

the company’s people journey which

led to establishing world-class HR sys-

tems and processes.

While detailing out the HR systems

further, Mr. Mitra soon realised the

need for the Performance Manage-ment System (PMS ) to be very robust.

Therefore, they designed it with Mer-

cer but took it a step further by tak-

ing it online. The system was named

‘PACE’, standing for, Performance And

Career Enhancement. Their compen-

sation system has a unique concept

of variable pay, that is, performance

bonus, ranging f rom 10 to 30 per cent

across all levels. The performance pa-

rameters for all are broken into the

two components of individual perfor-mance and company performance.

They also have a quar terly evaluation

along with which performance bonus

is paid out. Moreover, in their annual

performance appraisals, they ensure

that increment letters were handed

out to the employees on the first of

April every year. “In our company, the

philosophy is that we work hard, but

play harder! We have a lot of engage-

ment activities involving employees

and their families. Salary alone cannot

bind people to a company, and they

should get encouragement from timeto time to feel as a part of the team,”

says Mr. Mitra. Also, as an offshoot of

PACE, it undertakes numerous man-

agement development programmes.

The focus is on two things, that is, skill

development (for the junior level ) and

leadership building (for the senior and

middle levels ). The top management

is also sent to IMD and INSEAD for

advanced management training. Most

importantly, Apollo believes in impart-

ing training to those who perform orhave the potential for growth.

Apollo Tyres has grown through

some major acquisitions; one in 2006

when it acquired Dunlop South Af rica

and the other in 2009, the acquisition

of Vredestein of Netherlands, which

made Apollo an international company,

with 15,000 people on board: 10,000

in India and the rest internationally.

Adds, Mr. Mitra, “One of our major

challenges in HR has been to integrate

these new geographies. We have had

some cultural exchanges, where 50 key

managers from both these countriescame to India for a week and experi-

enced a taste of Indian culture, since

we invited all of them to our houses.”

Moreover, ‘Family Days’ are celebrat-

ed across all manufacturing facilities

across Apollo geographies. This is when

employees’ families are invited to visit

the plants and understand the nature

of work better. Another unique concept

is the ‘Apollo One Family’. Explaining it

further, Mr. Mitra says, “The ‘One Fam-

ily’ activities include get-togethers onfestivals, cricket tournaments (called

Apollo Unstoppable Cup ) in India, soc-

cer matches in South Africa, painting

competitions and summer camps for

children, and numerous other activi-

ties. For instance, we recently took our

senior management, along with their

family, on a three-day trip to Paris and

Amsterdam with all expenses paid by

the company. This helps to bind people

31 January 2011 The human facTor



together and gives a lot of mileage in terms of retention.”

Even birthdays are celebrated with great enthusiasm,

which the Vice Chairman makes it a point to attend,

and this feeling of togetherness is what Apollo always

strives for.

In 2010, its Greenfield plant commenced production

(set up in a record time of 14 months ). Apollo’s Chennai

plant is a state-of-the-art radial tyre plant with bench-

mark practices in line with the best in the world. With an

objective of creating Chennai as an iconic plant, lots of

new concepts have been brought in. The plant has a lean

organisational structure paving way for faster decisionmaking and empowered teams (Self Managed Teams ).

HR’s role is to ensure implementation of new concepts

and work practices, and develop an iconic culture.

Going forward, the company believes that integrating

different cultures would be a major challenge, along with

the usual challenges of controlling attrition, motivating

people, leadership development, and succession plan-

ning. Mr. Mitra hopes it will be an interesting journey

which will see Apollo reach new heights in terms of

human resources and business processes. t

Q. Shae wih us he Aoo so i Iia.

A. Apollo in India is in-step with the economy or even

outstripping the economy by some margin. At present,Indian operations comprise 60 per cent of our revenue

and we are looking at India a lone becoming a USD 2

billion operation in the next three years. We are look-

ing at very steep growth in all three customer chan-

nels, that is, replacement after-market, OE segment,

and exports. We also hope to double our exports (from

9 per cent of our revenue to about 20 per cent ).

Q. Wa ae yo gow pans o e saes

oi of view?

A. We have been the market leader in the commer-

cial vehicle space for the last three decades and allmarket leaders should be volume leaders, as well as

price leaders. Our mantra is profitable growth, and

we look at the bottom-line as well as the top-line. We

are also looking at the hinterlands. It is about great

product technology, even better after-sales service,

and a gameplan for your retailers where they see a

profit. These are the three pillars of growth and we

are innovating around them. In short, market leader-

ship around the product, customer engagement, and

operational excellence. As the only Indian company

exporting to Europe, we are able to compress the

life cycle of a mature market and bring those fruits

to India. While we have had volume growth, we arestill not the perceptual leaders in the market. But,

we do like to believe that we are the Asian Paints of

the tyre industry!

Q. What is the perception of Apollo in the

goba make?

A. We are the most-talked-about emerging player

within industry ci rcles. Our big task is to disassociate

ourselves from the Chinese because their perception

is very poor. But given the kind of acquisitions we

have made, our global workforce, and the way we

are approaching our every step, I think, within theindustry, they are looking at us very seriously.

Q. Is ee a peepion a Indian pods

ae o u high quai?

A. Perception-wise, we are considered better than the

Chinese, but the Chinese gravitat ional pull does exist.

But, if you have a manufacturing facility in Europe

(the way that we have ), then you can disassociate

yourself very easily.

ExcluSIvE Q&A WIth SAtISh ShArmA, chIEf

– IndIA OpErAtIOnS, ApOllO tyrES ltd.

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32 The human facTor January 2011

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Apollo Tyres (Lord of the Game)